[Federal Register: September 9, 2004 (Volume 69, Number 174)]
[Notices]
[Page 54718-54725]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr09se04-142]
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DEPARTMENT OF THE TREASURY
Community Development Financial Institutions Fund
Funding Opportunity Title: Notice of Funds Availability (NOFA)
Inviting Applications for the FY 2005 and FY 2006 Funding Rounds of the
Bank Enterprise Award (BEA) Program
Announcement Type: Initial announcement of funding opportunity.
Catalog of Federal Domestic Assistance (CDFA) Number: 21.021.
Dates: Applications for the FY 2005 funding round must be received
by 5 p.m. e.s.t. on February 14, 2005 and applications for the FY 2006
funding round must be received by 5 p.m. e.s.t. on February 14, 2006.
Applications must meet all eligibility and other requirements and
deadlines, as applicable, set forth in this NOFA. Applications received
after 5 p.m. e.s.t. on the applicable deadline will be rejected and
returned to the sender.
Executive Summary: This NOFA is issued in connection with the FY
2005 and FY 2006 funding rounds of the BEA Program. Through the BEA
Program, the Community Development Financial Institutions Fund (the
Fund) encourages Insured Depository Institutions to increase their
levels of loans, investments, services, and technical assistance within
Distressed Communities, and financial assistance to Community
Development Financial Institutions (CDFIs) through grants, stock
purchases, loans, deposits, and other forms of financial and technical
assistance, during a specified period.
I. Funding Opportunity Description
A. Baseline Period and Assessment Period Dates
A BEA Program award is based on an Applicant's increases in
Qualified Activities from the Baseline Period to the Assessment Period.
For the FY 2005 funding round, the Baseline Period is calendar year
2003 (January 1, 2003 through December 31, 2003), and the Assessment
Period is calendar year 2004 (January 1, 2004 through December 31,
2004). For the FY 2006 funding round, the Baseline Period is calendar
year 2004 (January 1, 2004 through December 31, 2004), and the
Assessment Period is calendar year 2005 (January 1, 2005 through
December 31, 2005).
B. Program Regulations
The regulations governing the BEA Program can be found at 12 CFR
part 1806 (the Interim Rule) and provide guidance on evaluation
criteria and other requirements of the BEA Program. The Fund encourages
Applicants to review the Interim Rule. Detailed application content
requirements are found in the application related to this NOFA. Each
capitalized term in this NOFA is more fully defined either in the
Interim Rule or the application.
C. Qualified Activities
Qualified Activities are defined in the Interim Rule to include
CDFI Related Activities, Distressed Community Financing Activities, and
Service Activities (12 CFR 1806.103(mm)). CDFI Related Activities
include Equity Investments, Equity-Like Loans, and CDFI Support
Activities (12 CFR 1806.103(p)). Distressed Community Financing
Activities include Affordable Housing Loans, Affordable Housing
Development Loans and related Project Investments; Education Loans;
Commercial Real Estate Loans and related Project Investments; Home
Improvement Loans; and Small Business Loans and related Project
Investments (12 CFR 1806.103(u)). Service Activities include Deposit
Liabilities, Financial Services, Community Services, Targeted Financial
Services, and Targeted Retail Savings/Investment Products (12 CFR
1806.103(oo)).
When calculating BEA Program award amounts, the Fund will count
only the amount an Applicant reasonably expects to disburse for a
Qualified Activity within 12 months from the end of the Assessment
Period. Subject to the exception outlined in Section I.G.1. of this
NOFA, in no event shall the value of a Qualified Activity for purposes
of determining a BEA Program award
[[Page 54719]]
exceed $10 million in the case of Commercial Real Estate Loans or any
CDFI Related Activities (i.e., the total principal amount of the
transaction must be $10 million or less to be considered a Qualified
Activity).
D. Designation of Distressed Community
An Applicant applying for a BEA Program award for carrying out
Distressed Community Financing Activities, Services Activities, or CDFI
Support Activities must designate one or more Distressed Communities.
Each CDFI Partner that is the recipient of CDFI Support Activities from
an Applicant must also designate a Distressed Community. The CDFI
Partner can identify a different Distressed Community than the
Applicant. Applicants providing Equity Investments to a CDFI, and CDFI
Partners that receive Equity Investments, are not required to designate
Distressed Communities. Please note that the CDFI Partner's designated
Distressed Community must meet the requirements of the BEA Program and
that a Distressed Community as defined by the BEA Program is not the
same as an Investment Area as defined by the Community Development
Financial Institutions (CDFI) Program, or a Low-Income Community as
defined by the New Markets Tax Credit (NMTC) Program.
1. Definition of Distressed Community
A Distressed Community, defined in the Interim Rule at 12 CFR
1806.103(t) and more fully described in 12 CFR 1806.200, must meet the
following minimum geographic, population, poverty, and unemployment
requirements:
(a) Geographic requirements: A Distressed Community must be a
geographic area: (i) That is located within the boundaries of a Unit of
General Local Government; (ii) the boundaries of which are contiguous;
and (A) The population of which is at least 4,000 if any portion of the
area is located within a Metropolitan Area with a population of 50,000
or greater; (B) the population must be at least 1,000 if no portion of
the area is located within such a Metropolitan Area; or (C) the area is
located entirely within an Indian Reservation.
(b) Economic distress requirements: A Distressed Community must be
a geographic area where: (i) At least 30 percent of the Residents have
incomes that are less than the national poverty level, as published by
the U.S. Bureau of the Census in the most recent decennial census for
which data is available; and (ii) the unemployment rate is at least 1.5
times greater than the national average, as determined by the U.S.
Bureau of Labor Statistics' most recent data, including estimates of
unemployment developed using the U.S. Bureau of Labor Statistics'
Census Share calculation method.
2. Designation of Distressed Community
An Applicant or CDFI Partner (as appropriate) shall designate an
area as a Distressed Community by:
(a) Selecting Geographic Units which individually meet the minimum
area eligibility requirements; or
(b) Selecting two or more Geographic Units which, in the aggregate,
meet the minimum area eligibility requirements set forth in paragraph
(1) of this section provided that no Geographic Unit selected by the
Applicant within the area has a poverty rate of less than 20 percent.
An Applicant engaging in Distressed Community Financing Activities
or Service Activities designates a Distressed Community by submitting:
(i) A List of Eligible Census Tracts; and (ii) a Map of the Distressed
Community.
An Applicant that engaged in CDFI Support Activities only (or CDFI
Support Activities and Equity Investments) may designate the same
Distressed Community as any one of its CDFI Partners by signing and
submitting with its application, a certification (included in the
application materials) that it is designating the same Distressed
Community as its CDFI Partner.
A CDFI Partner designates a Distressed Community by submitting: (i)
A List of Eligible Census Tracts; (ii) a Map of the Distressed
Community; and (iii) a Statement of Integral Involvement demonstrating
that the CDFI Partner is Integrally Involved in the Distressed
Community.
Applicants and CDFI Partners must use the CDFI Fund Information
Mapping System (CIMS) to designate Distressed Communities. CIMS is
accessed through myCDFIFund and contains step-by-step instructions on
how to create and print the aforementioned List of Eligible Census
Tracts and Map of the Distressed Community. MyCDFIFund is an electronic
interface that is accessed through the Fund's website (http://www.cdfifund.gov
). Instructions for registering with myCDFIFund are
available on the Fund's website. If you have any questions or problems
with registering, please contact the CDFI Fund IT HelpDesk by telephone
at (202) 622-2455, or by e-mail to ITHelpDesk@cdfi.treas.gov.
E. CDFI Related Activities
CDFI Related Activities include Equity Investments, Equity-Like
Loans, and CDFI Support Activities provided to eligible CDFI Partners.
In addition to regulatory requirements, this NOFA provides the
following:
1. Eligible CDFI Partner
CDFI Partner is defined as a CDFI that has been provided assistance
in the form of CDFI Related Activities by an Applicant (12 CFR
1806.103(o)). For the purposes of this NOFA, an eligible CDFI Partner
is:
(a) A CDFI that is not an insured credit union, insured depository
institution, or depository institution holding company, and that has up
to $25 million in total assets as of its most recently completed fiscal
year;
(b) A CDFI that is an insured credit union that has up to $25
million in total assets as of its most recently completed fiscal year;
(c)a CDFI that is an insured depository institution or depository
institution holding company and that has up to $500 million in total
assets as of its most recently completed fiscal year; or
(d) A CDFI proposing a new level or type of activity in a CDFI
Program-qualified Hot Zone (12 CFR part 1805, et seq.) (for further
information on the CDFI Program's Hot Zones, please refer to the most
recent NOFA for the Financial Assistance Component of the CDFI Program
which is available on the Fund's website at http://www.cdfifund.gov/programs
).
2.m Limitations on Eligible Qualified Activities Provided to Certain
CDFI Partners
An Applicant that is also a CDFI cannot receive credit for any
financial assistance or Qualified Activities provided to a CDFI Partner
that is also an FDIC-insured depository institution or depository
institution holding company.
3. Certificates of Deposit
Section 1806.103(q) of the Interim Rule states that any certificate
of deposit placed by an Applicant or its Subsidiary in a CDFI that is a
bank, thrift, or credit union must be: (i) Uninsured and committed for
at least three years; or (ii) insured, committed for a term of at least
three years, and provided at an interest rate that is materially below
market rates, in the determination of the Fund. For purposes of this
NOFA, ``materially below market interest rate'' is defined as an annual
percentage rate that does not exceed 100 percent of yields on Treasury
securities at constant maturity
[[Page 54720]]
as interpolated by Treasury from the daily yield curve and available on
the Federal Reserve website at http://www.federalreserve.gov/releases/H15/update.
For example, for a three-year certificate of deposit,
Applicants should use the three-year rate posted for U.S. Government
securities, Treasury Constant Maturity on H. 15 (Selected Interest
Rates) Daily Release. The Federal Reserve updates the H. 15 daily at
approximately 4 p.m. e.s.t. Certificates of deposit placed prior to
that time may use the rate posted for the previous day. The annual
percentage rate on a certificate of deposit should be compounded
quarterly, semi-annually, or annually. In addition, Applicants should
determine whether a certificate of deposit is insured based on the
total amount the Applicant or its Subsidiary has on deposit on the day
the certificate of deposit is placed. For example, if an Applicant
purchased a $100,000 3-year certificate of deposit from a CDFI in
April, 2003 and the Applicant purchases another $100,000 certificate of
deposit from the same CDFI in May, 2004, then the second certificate of
deposit should be treated as uninsured for purposes of calculating the
annual percentage rate. The Applicant must note, in its BEA Program
application, whether the certificate of deposit is insured or
uninsured.
F. Equity-Like Loans
An Equity-Like Loan is a loan provided by an Applicant or its
Subsidiary to a CDFI, and made on such terms that it has
characteristics of an Equity Investment (consistent with requirements
of the Appropriate Federal Banking Agency), as such characteristics may
be specified by the Fund (12 CFR 1806.103(y)). For purposes of this
NOFA, Equity-Like Loans must meet the following characteristics:
1. At the end of the initial term, the loan must have a definite
rolling maturity date that is automatically extended on an annual basis
if the CDFI borrower continues to be financially sound and carry out a
community development mission;
2. Periodic payments of interest and/or principal may only be made
out of the CDFI borrower's available cash flow after satisfying all
other obligations;
3. Failure to pay principal or interest (except at maturity) will
not automatically result in a default of the loan agreement; and
4. The loan must be subordinated to all other debt except for other
Equity-Like Loans. Notwithstanding the foregoing, the Fund reserves the
right to determine, in its sole discretion and on a case-by-case basis,
if an instrument meets the above-stated characteristics of an Equity-
Like Loan. Applicants must submit to the Fund for review, not later
than 45 days prior to the end of the applicable Assessment Period, all
documents evidencing loans that they wish to be considered as Equity-
Like Loans. The purpose for this request is to enhance the Fund's
ability to provide feedback to Applicants as to whether a transaction
meets the Equity-Like Loan characteristics prior to the end of the
applicable Assessment Period. The Fund will not redraft instruments,
provide language for Applicants, or render legal opinions related to
Equity-Like Loans. However, the Fund, in its sole discretion, may
comment as to the consistency of a proposed instrument with the above-
stated Equity-Like Loan characteristics. Such information will allow
Applicants, if they so choose, to modify the instruments to conform to
the program requirements prior to the end of the Assessment Period.
This process is intended to prevent circumstances in which an Applicant
executes loan documents without review by the Fund only to learn after
the close of the Assessment Period that the transaction is ineligible
for purposes of a BEA Program award. The Fund cannot guarantee timely
feedback to Applicants that submit the aforementioned documentation
less than 45 days prior to the end of the applicable Assessment Period.
G. Distressed Community Financing Activities
Distressed Community Financing Activities include Affordable
Housing Loans, Affordable Housing Development Loans and related Project
Investments, Education Loans, Commercial Real Estate Loans and related
Project Investments, Home Improvement Loans, and Small Business Loans
and related Project Investments (12 CFR 1806.103(u)). In addition to
the regulatory requirements, this NOFA provides the following
additional requirements.
1. Commercial Real Estate Loans and Related Project Investments
For purposes of this NOFA, eligible Commercial Real Estate Loans
(12 CFR 1806.103(l)) and related Project Investments (12 CFR
1806.103(ll)) are generally limited to transactions with a total
principal value of up to and including $10 million. The Fund will
calculate award amounts in accordance with Section VIII.B. of this
NOFA. Notwithstanding the foregoing, the Fund, in its sole discretion,
may consider transactions with a total principal value of over $10
million, subject to review and approval of the Applicant's ``community
benefit statement.'' The Applicant must demonstrate that the proposed
project offers, or significantly enhances the quality of, a facility or
service not currently provided to the Distressed Community. The
application form contains additional information on how to fulfill this
requirement.
2. Reporting Certain Financial Services
The Fund will value the administrative cost of providing certain
Financial Services at the following per unit values:
(a) $100.00 per account for Targeted Financial Services;
(b) $50.00 per account for checking and savings accounts that do
not meet the definition of Targeted Financial Services;
(c) $5.00 per check cashing transaction times the total number of
check cashing transactions;
(d) $25,000 per new ATM installed at a location in a Distressed
Community;
(e) $2,500 per ATM operated at a location in a Distressed
Community;
(f) $250,000 per new retail bank branch office opened in a
Distressed Community; and
(g) in the case of Applicants engaging in Financial Services
activities not described above, the Fund will determine the account or
unit value of such services.
3. In the case of opening a new retail bank branch office, the
Applicant must certify that it has not operated a retail branch in the
same census tract in which the new retail branch office is being opened
in the past three years, and that such new branch will remain in
operation for at least the next five years.
Financial Service Activities must be provided by the Applicant to
Low- and Moderate-Income Residents. An Applicant may determine the
number of Low- and Moderate-Income individuals who are recipients of
Financial Services by either:
(a) Collecting income data on its Financial Services customers; or
(b) Certifying that the Applicant reasonably believes that such
customers are Low- and Moderate-Income individuals and providing a
brief analytical narrative with information describing how the
Applicant made this determination.
II. Award Information
A. Award Amounts
Subject to funding availability, the Fund expects that it may award
approximately $4 million for FY 2005
[[Page 54721]]
BEA Program awards, and approximately $6 million for FY 2006 BEA
Program awards, in appropriated funds under this NOFA. The Fund
reserves the right to award in excess of said funds under this NOFA,
provided that the appropriated funds are available and the Fund deems
it appropriate. Under this NOFA, the Fund anticipates a maximum award
amount of $500,000 per Applicant. The Fund, in its sole discretion,
reserves the right to award amounts in excess of the anticipated
maximum award amount if the Fund deems it appropriate. Further, the
Fund reserves the right to fund, in whole or in part, any, all, or none
of the applications submitted in response to this NOFA. The Fund
reserves the right to re-allocate funds from the amount that is
anticipated to be available under this NOFA to other Fund programs,
particularly if the Fund determines that the number of awards made
under this NOFA is fewer than projected.
When calculating award amounts, the Fund will count only the amount
an Applicant reasonably expects to disburse on a transaction within 12
months from the end of the Assessment Period. Subject to the exception
outlined in Section I. G.1. of this NOFA, in no event shall the value
of a Qualified Activity for purposes of determining a BEA Program award
exceed $10 million in the case of Commercial Real Estate Loans or any
CDFI Related Activities (i.e., the total principal amount of the
transaction must be $10 million, or less to be considered a Qualified
Activity).
H. Types of Awards
BEA Program awards are made in the form of grants.
I. Notice of Award and Award Agreement
Each awardee under this NOFA must sign a Notice of Award and an
Award Agreement prior to disbursement by the Fund of award proceeds.
The Notice of Award and the Award Agreement contain the terms and
conditions of the award. For further information, see Section IX. of
this NOFA.
III. Eligibility
A. Eligible Applicants
The legislation that authorizes the BEA Program specifies that
eligible Applicants for the BEA Program must be Insured Depository
Institutions, as defined in 12 U.S.C. Sec. 1813(c)(2). An Applicant
must be FDIC-insured by December 31, 2004 for the FY 2005 funding round
and by December 31, 2005 for the FY 2006 funding round to be eligible
for consideration for a BEA Program award under this NOFA.
1. Prior Awardees
Applicants must be aware that success in a prior round of any of
the Fund's programs is not indicative of success under this NOFA. Prior
BEA Program awardees and prior awardees of other Fund programs are
eligible to apply under this NOFA, except as follows:
(a) Failure to meet reporting requirements: The Fund will not
consider an application submitted by an Applicant if the Applicant, or
an entity that Controls (as such term is defined in paragraph (g)
below) the Applicant, is Controlled by the Applicant or shares common
management officials with the Applicant (as determined by the Fund) is
a prior Fund awardee or allocatee under any Fund program and is not
current on the reporting requirements set forth in the previously
executed assistance, award or allocation agreement(s), as of the
application deadline(s) of this NOFA. Please note that the Fund only
acknowledges the receipt of reports that are complete. As such,
incomplete reports or reports that are deficient of required elements
will not be recognized as having been received.
(b) Pending resolution of noncompliance: If an Applicant that is a
prior awardee or allocatee under any Fund program and if: (i) It has
submitted complete and timely reports to the Fund that demonstrate
noncompliance with a previous assistance, award or allocation
agreement, and (ii) the Fund has yet to make a final determination as
to whether the entity is in default of its previous assistance, award
or allocation agreement, the Fund will consider the Applicant's
application under this NOFA pending full resolution, in the sole
determination of the Fund, of the noncompliance. Further, if another
entity that Controls the Applicant, is Controlled by the Applicant or
shares common management officials with the Applicant (as determined by
the Fund), is a prior Fund awardee or allocatee and if such entity: (i)
Has submitted complete and timely reports to the Fund that demonstrate
noncompliance with a previous assistance, award or allocation
agreement, and (ii) the Fund has yet to make a final determination as
to whether the entity is in default of its previous assistance, award
or allocation agreement, the Fund will consider the applicant's
application under this NOFA pending full resolution, in the sole
determination of the Fund, of the noncompliance.
(c) Default status: The Fund will not consider an application
submitted by an Applicant that is a prior Fund awardee or allocatee
under any Fund program if, as of the application deadline of this NOFA,
the Fund has made a final determination that such Applicant is in
default of a previously executed assistance, award or allocation
agreement(s) and the Fund has provided written notification of such
determination to such Applicant. Further, an entity is not eligible to
apply for an award pursuant to this NOFA if, as of the application
deadline, the Fund has made a final determination that another entity
that Controls the Applicant, is Controlled by the Applicant or shares
common management officials with the Applicant (as determined by the
Fund): (i) Is a prior Fund awardee or allocatee under any Fund program,
(ii) has been determined by the Fund to be in default of a previously
executed assistance, award or allocation agreement(s), and (iii) the
Fund has provided written notification of such determination to the
defaulting entity.
(d) Termination in default: The Fund will not consider an
application submitted by an Applicant that is a prior Fund awardee or
allocatee under any Fund program if, within the 12-month period prior
to the application deadline of this NOFA, the Fund has made a final
determination that such Applicant's prior award or allocation
terminated in default of the assistance, award or allocation agreement
and the Fund has provided written notification of such determination to
such Applicant. Further, an entity is not eligible to apply for an
award pursuant to this NOFA if, within the 12-month period prior to the
application deadline of this NOFA, the Fund has made a final
determination that another entity that Controls the Applicant, is
Controlled by the Applicant or shares common management officials with
the Applicant (as determined by the Fund), is a prior Fund awardee or
allocatee under any Fund program whose award or allocation terminated
in default of the assistance, award or allocation agreement and the
Fund has provided written notification of such determination to the
defaulting entity.
(e) Undisbursed balances: The Fund will not consider an application
submitted by an Applicant that is a prior Fund awardee under any Fund
program if the Applicant has a balance of undisbursed funds (defined
below) under said prior award(s), as of the application deadline of
this NOFA. Further, an entity is not eligible to apply for an award
pursuant to this NOFA if
[[Page 54722]]
another entity that Controls the Applicant, is Controlled by the
Applicant or shares common management officials with the Applicant (as
determined by the Fund), is a prior Fund awardee under any Fund
program, and has a balance of undisbursed funds (defined below) under
said prior award(s), as of the application deadline of this NOFA. In
the case where another entity Controls the Applicant, is Controlled by
the Applicant or shares common management officials with the Applicant
(as determined by the Fund), is a prior Fund awardee under any Fund
program, and has a balance of undisbursed funds under said prior
award(s), as of the application deadline of this NOFA, the Fund will
include the combined awards of the Applicant and such affiliated
entities when calculating the amount of undisbursed funds.
(f) For the purposes of this section, ``undisbursed funds'' is
defined as: (i) In the case of prior BEA Program award(s), any balance
of award funds equal to or greater than five (5) percent of the total
prior BEA Program award(s) that remains undisbursed more than three (3)
years after the end of the calendar year in which the Fund signed an
award agreement with the Awardee, and (ii) in the case of prior CDFI
Program or other Fund program award(s), any balance of award funds
equal to or greater than five (5) percent of the total prior award(s)
that remains undisbursed more than two (2) years after the end of the
calendar year in which the Fund signed an assistance agreement with the
awardee.
``Undisbursed funds'' does not include (i) Tax credit allocation
authority allocated through the New Markets Tax Credit Program; (ii)
any award funds for which the Fund received a full and complete
disbursement request from the awardee as of the application deadline of
this NOFA; and (iii) any award funds for an award that has been
terminated, expired, rescinded, or deobligated by the Fund.
(g) For purposes of this NOFA, the term ``Control'' means: (1)
Ownership, control, or power to vote 25 percent or more of the
outstanding shares of any class of Voting Securities (as defined in 12
CFR 1805.104(mm)) of any legal entity, directly or indirectly or acting
through one or more other persons; (2) control in any manner over the
election of a majority of the directors, trustees, or general partners
(or individuals exercising similar functions) of any legal entity; or
(3) the power to exercise, directly or indirectly, a controlling
influence over the management, credit or investment decisions, or
policies of any legal entity.
(h) Contact the Fund: Accordingly, Applicants that are prior
awardees and/or allocatees under any Fund program are advised to: (i)
Comply with requirements specified in assistance, award and/or
allocation agreement(s), and (ii) contact the Fund to ensure that all
necessary actions are underway for the disbursement of any outstanding
balance of a prior award(s). All outstanding reports, compliance or
disbursement questions should be directed to the Grants Management and
Compliance Manager by e-mail at gmc@cdfi.treas.gov; by telephone at
(202) 622-8226; by facsimile at (202) 622-6453; or by mail to CDFI
Fund, 601 13th Street, NW., Suite 200 South, Washington, DC 20005. The
Fund will respond to Applicants' reporting, compliance or disbursement
questions between the hours of 9 a.m. and 5 p.m. e.s.t., starting the
date of the publication of this NOFA through February 10, 2005 (for the
FY 2005 funding round) and through February 10, 2006 (for the FY 2006
funding round) (two business days before the application deadline). The
Fund will not respond to Applicants' reporting, compliance or
disbursement telephone calls or e-mail inquiries that are received
after 5 p.m. e.s.t. on February 10, 2005 until after the funding
application deadline of February 14, 2005 for the FY 2005 funding round
or after 5 p.m. e.s.t. on February 10, 2006 until after the funding
application deadline of February 14, 2006 for the FY 2006 funding
round.
2. Cost Sharing and Matching Fund Requirements
Not applicable.
3. Prohibition Against Double Funding
No CDFI may receive a BEA Program award if it has:
(a) An application pending for assistance under the CDFI Program
(12 CFR part 1805, et seq.);
(b) Directly received assistance from the Fund under the CDFI
Program within the 12-month period prior to the date the Fund selected
the Applicant to receive a BEA Program award; or
(c) Ever received assistance under the CDFI Program for the same
activities for which it is seeking a BEA Program award.
An insured depository institution investor (and its affiliates and
Subsidiaries) may not receive a BEA Program award in addition to a New
Markets Tax Credit Program allocation for the same investment in a
Community Development Entity, as defined at 26 U.S.C. Sec. 45D(c).
IV. Application and Submission Information
A. Address to Request Application Package
Applicants may submit applications under this NOFA in paper form
(except as provided below for the Report of Transactions). Shortly
following the publication of this NOFA, the Fund will make the FY 2005-
2006 BEA Program application materials available on its Web site at
http://www.cdfifund.gov. The Fund will send application materials to
Applicants that are unable to download them from the Web site. To have
application materials sent to you, contact the Fund by telephone at
(202) 622-6355; by e-mail at cdfihelp@cdfi.treas.gov; or by facsimile
at (202) 622-7754. These are not toll free numbers.
B. Application Content Requirements
Detailed application content requirements are found in the
application related to this NOFA. Applicants must submit all materials
described in and required by the application by the applicable
deadlines. Applicants will not be afforded an opportunity to provide
any missing materials or documentation. Additional information,
including instructions relating to the submission of the application
and supporting documentation, is set forth in further detail in the
application. Please note that, pursuant to OMB guidance (68 FR 38402),
each Applicant must provide, as part of its application submission, a
Dun and Bradstreet Data Universal Numbering System (DUNS) number. In
addition, each application must include a valid and current Employer
Identification Number (EIN), with a letter or other documentation from
the Internal Revenue Service (IRS) confirming the EIN. Incomplete
applications will be rejected and returned to the sender.
An Applicant may not submit more than one application in response
to either the FY 2005 funding round or FY 2006 funding round.
C. Form of Application Submission
Applicants must submit applications under this NOFA in paper form,
with the exception of the required electronic submission of the Report
of Transactions (see Section IV.D.3. of this NOFA). Applications sent
by facsimile or by e-mail will not be accepted.
[[Page 54723]]
D. Application Submission Dates and Times
1. Application Deadlines
The deadline for receipt of applications for the FY 2005 funding
round is 5 p.m. e.s.t. on February 14, 2005. The deadline for receipt
of applications for the FY 2006 funding round is 5 p.m. e.s.t. on
February 14, 2006. Applications and other required documents and other
attachments received after 5 p.m. e.s.t. on the applicable date will be
rejected and returned to the sender. Please note that the document
submission deadlines in this NOFA and/or the funding application are
strictly enforced. The Fund will not grant exceptions or waivers for
late delivery of documents including, but not limited to, late delivery
that is caused by third parties such as the United States Postal
Service, couriers or overnight delivery services. Nor will the Fund
afford Applicants the opportunity to provide missing documentation
after said deadline(s).
2. Paper Applications
Paper applications must be received in their entirety by the
applicable time and date, including an original (i.e., not a photocopy
or faxed copy) Applicant Information Form signed by the identified
Authorized Representative, a letter or other documentation from the
Internal Revenue Service confirming the Applicant's Employer
Identification Number (EIN), and all other required paper attachments.
3. Electronic Submission of Report of Transactions
In order to expedite application review, Applicants must submit a
specific section of the application, the Report of Transactions form,
electronically (via myCDFIFund) per the instructions provided on the
Fund's Web site, by 5 p.m. e.s.t. on February 14, 2005 (for the FY 2005
funding round) or by 5 p.m. e.s.t. on February 14, 2006 (for the FY
2006 funding round). Applicants will be unable to submit Reports of
Transactions after said dates and times. Nor will Applicants have an
opportunity to submit corrected Reports of Transactions after said
dates and times.
V. Intergovernmental Review
Not Applicable.
VI. Funding Restrictions
Not Applicable.
VII. Addresses
Paper applications must be sent to: CDFI Fund Grants Management and
Compliance Manager, BEA Program, Bureau of Public Debt, 200 Third
Street, Room 10, Parkersburg, WV 26101. The telephone number to be used
in conjunction with overnight mailings to this address is (304) 480-
5450. The Fund will not accept applications in its offices in
Washington, DC. Applications and attachments received in the Fund's
Washington, DC offices will be rejected and returned to the sender. In
addition, as provided above, Applicants must submit completed Reports
of Transactions via myCDFIFund by the applicable deadline. The Fund
will not afford Applicants an opportunity to provide missing
documentation after the applicable deadline.
VIII. Application Review Information
A. Priority Factors
Priority Factors are the numeric values assigned to individual
types of activity within a category of Qualified Activity. A Priority
Factor represents the Fund's assessment of the degree of difficulty,
the extent of innovation (including, for example, pricing), and the
extent of benefits accruing to the Distressed Community for each type
of activity. The Priority Factor works by multiplying the change in a
Qualified Activity by its assigned Priority Factor to achieve a
``weighted value.'' This weighted value of the change would be
multiplied by the applicable award percentage to yield the award amount
for that particular activity. For purposes of this NOFA, the Fund is
establishing Priority Factors for the Distressed Community Financing
Activities category only, as follows:
------------------------------------------------------------------------
Priority
Qualified activities factor
------------------------------------------------------------------------
Affordable Housing Loans................................... 3.0
Education Loans............................................ 3.0
Home Improvement Loans..................................... 3.0
Small Business Loans and related Project Investments....... 3.0
Affordable Housing Development Loans and related Project 2.0
Investments...............................................
Commercial Real Estate Loans and related Project 2.0
Investments...............................................
------------------------------------------------------------------------
B. Award Percentages, Award Amounts, Selection Process
The Interim Rule describes the process for selecting Applicants to
receive BEA Program awards and determining award amounts. Applicants
will calculate and request an estimated award amount in accordance with
a multiple step procedure that is outlined in the Interim Rule (at 12
CFR 1806.202). The Fund will use the Applicant's estimated award amount
as the basis for calculating the actual award amount that an Applicant
may receive. As outlined in the Interim Rule at 12 CFR 1806.203, the
Fund will determine actual award amounts based on the availability of
funds, increases in Qualified Activities from the Baseline Period to
the Assessment Period, and each Applicant's priority ranking. In
calculating the increase in Qualified Activities, the Fund will
determine the eligibility of each transaction for which an Applicant
has applied for a BEA Program award. In some cases, the actual award
amount calculated by the Fund may not be the same as the estimated
award amount requested by the Applicant.
In the CDFI Related Activities category (except for Equity
Investments), if an Applicant is a CDFI, such estimated award amount
will be equal to 18 percent of the increase in Qualified Activity for
the category. If an Applicant is not a CDFI, such estimated award
amount will be equal to 6 percent of the increase in Qualified Activity
for the category. Notwithstanding the foregoing, the award percentage
applicable to an Equity Investment, Equity-Like Loan, or Grant in a
CDFI shall be 15 percent of the increase in Qualified Activity for the
category. For the Distressed Community Financing Activities and Service
Activities categories, if an Applicant is a CDFI, such estimated award
amount will be equal to 9 percent of the weighted value of the increase
in Qualified Activity for the category. If an Applicant is not a CDFI,
such estimated award amount will be equal to 3 percent of the weighted
value of the increase in Qualified Activity for the category.
If the amount of funds available during the funding round is
insufficient for all estimated award amounts, Awardees will be selected
based on the process described in the Interim Rule at 12 CFR
1806.203(b). This process gives funding priority to Applicants that
undertake activities in the following order:
1. CDFI Related Activities;
2. Distressed Community Financing Activities, and
3. Service Activities.
Within each category, Applicants will be ranked according to the
ratio of the actual award amount calculated by the Fund for the
category to the total assets of the Applicant. Within the Distressed
Community Financing category as well as the Service Activities
category, Applicants that are certified CDFIs will be ranked first, and
then Applicants that have carried out such Distressed Community
Financing Activities and
[[Page 54724]]
Service Activities in a Distressed Community that encompasses an Indian
Reservation.
The Fund, in its sole discretion: (i) May adjust the estimated
award amount that an Applicant may receive; (ii) may establish a
maximum amount that may be awarded to an Applicant; and (iii) reserves
the right to limit the amount of an award to any Applicant if the Fund
deems it appropriate.
For purposes of calculating award disbursement amounts, the Fund
will treat Qualified Activities with a total principal amount of less
than $250,000 as fully disbursed. Awardees will have 12 months from the
end of the Assessment Period to make disbursements for Qualified
Activities and 18 months to submit to the Fund disbursement requests
for the corresponding portion of their awards, after which the Fund
will rescind and deobligate any outstanding award balance and said
outstanding award balance will no longer be available to the Awardee.
The Fund reserves the right to change its eligibility and
evaluation criteria and procedures, if the Fund deems it appropriate;
if said changes materially affect the Fund's award decisions, the Fund
will provide information regarding the changes through the Fund's
website.
There is no right to appeal the Fund's award decisions. The Fund's
award decisions are final.
IX. Award Administration Information
A. Notice of Award
The Fund will signify its selection of an Applicant as an Awardee
by delivering a signed Notice of Award and Award Agreement to the
Applicant. The Notice of Award will contain the general terms and
conditions underlying the Fund's provision of an award including, but
not limited to, the requirement that an Awardee and the Fund enter into
an Award Agreement. The Applicant must execute the Notice of Award and
return it to the Fund along with the Award Agreement. The Fund reserves
the right, in its sole discretion, to rescind its award and Notice of
Award if the Awardee fails to return the Notice of Award or Award
Agreement, signed by the Authorized Representative of the Awardee,
along with any other requested documentation, by the deadline set by
the Fund.
By executing a Notice of Award, the Awardee agrees that, if
information (including administrative errors) comes to the attention of
the Fund that either adversely affects the Awardee's eligibility for an
award, or adversely affects the Fund's evaluation of the Awardee's
application, or indicates fraud or mismanagement on the part of the
Awardee, the Fund may, in its discretion and without advance notice to
the Awardee, terminate the Notice of Award or take such other actions
as it deems appropriate.
1. Failure To Meet Reporting Requirements
If an Applicant, or an entity that Controls the Applicant, is
Controlled by the Applicant or shares common management officials with
the Applicant (as determined by the Fund) is a prior Fund awardee or
allocatee under any Fund program and is not current on the reporting
requirements set forth in the previously executed assistance, award or
allocation agreement(s), as of the date of the Notice of Award, the
Fund reserves the right, in its sole discretion, to delay entering into
an Award Agreement and/or to delay making a disbursement of award
proceeds, until said prior awardee or allocatee is current on the
reporting requirements in the previously executed assistance, award or
allocation agreement(s). Please note that the Fund only acknowledges
the receipt of reports that are complete. As such, incomplete reports
or reports that are deficient of required elements will not be
recognized as having been received. If said prior awardee or allocatee
is unable to meet this requirement within the timeframe set by the
Fund, the Fund reserves the right, in its sole discretion, to terminate
and rescind the Notice of Award and the award made under this NOFA.
2. Pending Resolution of Noncompliance
If an Applicant is a prior Fund awardee or allocatee under any Fund
program and if: (i) It has submitted complete and timely reports to the
Fund that demonstrate noncompliance with a previous assistance, award,
or allocation agreement, and (ii) the Fund has yet to make a final
determination regarding whether or not the entity is in default of its
previous assistance, award, or allocation agreement, the Fund reserves
the right, in its sole discretion, to delay entering into an Award
Agreement and/or to delay making a disbursement of award proceeds,
pending full resolution, in the sole determination of the Fund, of the
noncompliance. Further, if another entity that Controls the Applicant,
is Controlled by the Applicant or shares common management officials
with the Applicant (as determined by the Fund), is a prior Fund awardee
or allocatee under any Fund program, and if such entity: (i) Has
submitted complete and timely reports to the Fund that demonstrate
noncompliance with a previous assistance, award, or allocation
agreement, and (ii) the Fund has yet to make a final determination as
to whether the entity is in default of its previous assistance, award,
or allocation agreement, the Fund reserves the right, in its sole
discretion, to delay entering into an Award Agreement and/or to delay
making a disbursement of award proceeds pending full resolution, in the
sole determination of the Fund, of the noncompliance. If said prior
awardee or allocatee is unable to meet this requirement, in the sole
determination of the Fund, the Fund reserves the right, in its sole
discretion, to terminate and rescind the Notice of Award and the award
made under this NOFA.
3. Default Status
If, at any time prior to entering into an Award Agreement under
this NOFA, the Fund has made a final determination that an Applicant
that is a prior Fund awardee or allocatee under any Fund program is in
default of a previously executed assistance, award, or allocation
agreement(s) and has provided written notification of such
determination to the Applicant, the Fund reserves the right, in its
sole discretion, to delay entering into an Award Agreement and/or to
delay making a disbursement of award proceeds until said prior awardee
or allocatee has submitted a complete and timely report demonstrating
full compliance with said agreement within a timeframe set by the Fund.
Further, if, at any time prior to entering into an Award Agreement
under this NOFA, the Fund has made a final determination that another
entity which Controls the Applicant, is Controlled by the Applicant or
shares common management officials with the Applicant (as determined by
the Fund), is a prior Fund awardee or allocatee under any Fund program,
and is in default of a previously executed assistance, allocation or
award agreement(s) and has provided written notification of such
determination to the defaulting entity, the Fund reserves the right, in
its sole discretion, to delay entering into an Award Agreement and/or
to delay making a disbursement of award proceeds until said prior
awardee or allocatee has submitted a complete and timely report
demonstrating full compliance with said agreement within a timeframe
set by the Fund. If said prior awardee or allocatee is unable to meet
this requirement, the Fund
[[Page 54725]]
reserves the right, in its sole discretion, to terminate and rescind
the Notice of Award and the award made under this NOFA.
4. Termination in Default
If, within the 12-month period prior to entering into an Award
Agreement under this NOFA, the Fund has made a final determination that
an Applicant that is a prior Fund awardee or allocatee under any Fund
program whose award or allocation terminated in default of such prior
agreement and the Fund has provided written notification of such
determination to such organization, the Fund reserves the right, in its
sole discretion, to delay entering into an Award Agreement and/or to
delay making a disbursement of award proceeds. Further, if, within the
12-month period prior to entering into an Award Agreement under this
NOFA, the Fund has made a final determination that another entity which
Controls the Applicant, is Controlled by the Applicant or shares common
management officials with the Applicant (as determined by the Fund), is
a prior Fund awardee or allocatee under any Fund program, and whose
award or allocation terminated in default of such prior agreement(s)
and has provided written notification of such determination to the
defaulting entity, the Fund reserves the right, in its sole discretion,
to delay entering into an Award Agreement and/or to delay making a
disbursement of award proceeds.
B. Award Agreement
After the Fund selects an Awardee, the Fund and the Awardee will
enter into an Award Agreement. The Award Agreement shall provide that
an Awardee shall: (i) Carry out its Qualified Activities in accordance
with applicable law, the approved application, and all other applicable
requirements; (ii) comply with such other terms and conditions
(including recordkeeping and reporting requirements) that the Fund may
establish; and (iii) not receive any monies until the Fund has
determined that the Awardee has fulfilled all applicable requirements.
C. Administrative and National Policy Requirements
Not applicable.
D. Reporting and Accounting
Not applicable.
X. Agency Contacts
The Fund will respond to questions and provide support concerning
this NOFA and the funding application between the hours of 9 a.m. and 5
p.m. e.s.t., starting the date of the publication of this NOFA through
close of business February 10, 2005 for the FY 2005 funding round (2
business days before the application deadline) and through close of
business February 10, 2006 for the FY 2006 funding round (2 business
days before the application deadline).
The Fund will not respond to questions or provide support
concerning the application after 5 p.m. e.s.t. on February 10, 2005 for
the FY 2005 funding round, until after the application deadline of
February 14, 2005. The Fund will not respond to questions or provide
support concerning the application after 5 p.m. e.s.t. on February 10,
2006 for the FY 2006 funding round, until after the application
deadline of February 14, 2006.
Applications and other information regarding the Fund and its
programs may be downloaded and printed from the Fund's Web site at
http://www.cdfifund.gov. The Fund will post on its Web site responses
to questions of general applicability regarding the BEA Program.
A. Information Technology Support
Technical support can be obtained by calling (202) 622-2455 or by
e-mail at ithelpdesk@cdfi.treas.gov. People who have visual or mobility
impairments that prevent them from creating Hot Zone or Distressed
Community maps using the Fund's Web site should call (202) 622-2455 for
assistance. These are not toll free numbers.
B. Programmatic Support
If you have any questions about the programmatic requirements (such
as the eligibility of specific transactions or CDFI Partners), contact
a member of the BEA Program staff, who can be reached by e-mail at
cdfihelp@cdfi.treas.gov, by telephone at (202) 622-6355, by facsimile
at (202) 622-7754, or by mail at CDFI Fund, 601 13th Street, NW., Suite
200 South, Washington, DC 20005. These are not toll-free numbers.
C. Administrative Support
If you have any questions regarding the administrative requirements
of this NOFA, contact the Fund's Grants Management and Compliance
Manager by e-mail at gmc@cdfi.treas.gov, by telephone at (202) 622-
8226, by facsimile at (202) 622-9625, or by mail at CDFI Fund, 601 13th
Street, NW., Suite 200 South, Washington, DC 20005. These are not toll
free numbers.
D. Legal Counsel Support
If you have any questions or matters that you believe require
response by the Fund's Office of Legal Counsel, please refer to the
document titled ``How to Request a Legal Review'', found on the Fund's
Web site at http://www.cdfifund.gov.
Authority: 12 U.S.C. 1834a, 4703, 4703 note, 4713; 12 CFR part
1806.
Dated: September 3, 2004.
Arthur A. Garcia,
Director, Community Development Financial Institutions Fund.
[FR Doc. 04-20460 Filed 9-8-04; 8:45 am]
BILLING CODE 4810-70-P